Find a business credit card
Credit cards are an extremely popular tool in the UK, with the total credit card spend in the UK reaching £22.5 billion as of July 2024 and over a third of all purchases being made with a credit card.
But are they helpful for businesses?
If you’re considering taking out a business credit card, this page tackles some of the biggest questions you may have, including the risks and drawbacks to be aware of going in and what could happen if you go over your credit limit.
What are the benefits of a business credit card?
Business credit cards come with a range of helpful benefits that can be used to help manage your business cash flow. Here are some of the main ones.
Expense separation
When you first start running a business, it can be tempting to pay for business expenses with a personal card, simply for ease. However, this can quickly become unmanageable as more team members join your company and your bills stack up, creating the need to spend longer and longer categorising and separating these expenses.
Business credit cards intrinsically allow you to separate personal and business expenses, simplifying your accounting processes. They provide you with a card that can be used only for business costs, many even connect to your financial accounting tools.
Simplified business expense management
Speaking of integration with financial tools, business credit cards often come with a range of additional features that assist in expense management, including detailed records of every expense, the ability to export expense statements, the ability to categorise expenses, adding additional users, and setting spending limits.
These last two are particularly noteworthy. As you grow as a business, the ability to add users and set individual spending limits becomes critical for maintaining financial control as a business. Plus, once you’ve connected your accounting tools, you’ll gain real-time visibility into company wide spending.
A company credit card also enables you to eliminate the need for petty cash, which can be a huge help in reducing administrative burdens. Pretty cash often requires a substantial amount of time spent chasing down and categorising receipts for what are often objectively very small payments – a credit card partnered with an accounting tool can help streamline this substantially.
Card specific rewards
Rewards are one of the best benefits of business credit cards. While the other benefits are more about optimisation and streamlining, rewards can be a little more exciting.
As you spend, many credit cards provide rewards. These can come in the form of points, which can be used to purchase additional products, miles, which can be used to purchase flights, or other rewards such as new technology tools.
Over time, these rewards can grow and stack up, turning into significant savings or perks. The nice thing about rewards is you don’t usually need to change anything about your company spending habits beyond using the credit card when making purchases rather than a different card, and you still get rewarded – it’s like a bonus just for business as usual.
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What types of business credit cards can I get in the UK?
Free credit cards
At Funding Options by Tide, we help facilitate Capital on Tap business credit cards. A free business credit card comes with no annual fee and uncapped 1% cashback on all card spending and no foreign exchange fees.
Business credit cards
The business credit card costs £99 a year when billed annually, enables you to convert reward points to Avios, and gives you 10,000 bonus points when you spend £5,000 in your first 3 months.
Pro credit cards
The pro credit card is £299 per year and gives you access to everything in the first 2 tiers, plus unlimited access to 1,600+ airport lounges for the main card holder, 2 free guest lounge passes a year, a premium metal card and Radisson Rewards VIP status.
How much can you afford to borrow?
If you're ready to take your business to the next level, use our business loans calculator to get an idea of what you can afford.
Want to understand the cost of your loan?
Use our business loan calculator below to find out how much you can borrow to take your business to the next level.
Calculations are indicative only and intended as a guide only. The figures calculated are not a statement of the actual repayments that will be charged on any actual loan and do not constitute a loan offer.
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Financial product information
Representative example*
• 7.63% APR Representative based on a loan of £50,000 repayable over 24 months.
• Monthly repayment of £2,252.94. The total amount payable is £54,070.56
*Some lenders may apply fees during the application process, please note that these are set and provided by these entities.
Annual Percentage Rates
Rates from 2.75% APR
Repayment period
1 month to 30 years terms
What is a business credit card?
Short term funding
A business credit card is similar to a personal credit card – it provides your business with short-term funding to be spent on business related expenses, which you must then repay within a pre-agreed given period, usually a month.
Replenish and reuse
The funds are then replenished and available for reuse, usually, until either you or the lender cancels the card. Credit cards are a type of revolving credit facility, which is the term for credit agreements where a pre-approved limit is set and you are able to draw from the limit multiple times.
Card based
Credit cards have the specific feature of being card-based, meaning an account is tied to a physical, or digital, card. This makes credit cards suitable for expenses such as online purchases, acquiring inventory, and equipment. Their card based nature makes them less suitable for paying employees, forwarding funds to suppliers, or paying rent – for these payments, a business loan may be more suitable.
What can I use a business credit card for?
Running a business
You can pay for running costs, including office and inventory expenses, as well as cost of sales, all while gaining cashback rewards.
Emergency costs
Surprise emergency costs, for example, repairs or equipment replacements, as well as purchasing brand new equipment, can all be paid for with a credit card.
Growth enablement
Credit cards can be used to pay for marketing, entertaining clients, paying for business meals, or to fund the cost of travel, including flights, hotels, and car rentals.
Find out more about business credit cards
How do business credit cards work?
There is usually a set credit limit that determines how much money you can spend and like a standard personal credit card, interest is often applied to the withdrawn balance until you make a full repayment.
Many business credit cards offer 0% interest rates if the funds are returned within the month. This can make credit cards a helpful tool for maintaining healthy cash flow, as you can use the card to purchase inventory or pay for technology subscriptions, deliver services to your client over the course of the month, then pay off the credit card when your client pays your invoice, all without paying interest.
However, do take extra care, as many credit cards do charge very large interest rates if the one month grace period has passed and payment has not yet been made.
When comparing different business credit cards, pay attention to details like APR, rewards, additional fees, and interest-free periods. These factors help you find the most suitable card for your business’s current needs.
Who can get a business credit card?
In the UK, you must be over 18 and must generally be a sole trader, limited company, or partnership to obtain a business credit card. The eligibility criteria can vary depending on the business credit card provider and can include requirements such as account records or a minimum monthly revenue.
Most business credit card providers will check your business’s creditworthiness, and some will review your personal credit history as well. Once you have the card, missed or late payments can negatively impact your business’s creditworthiness.
What fees do I need to pay for a business credit card?
Along with knowing the different types of business credit cards, it’s also important to be aware of the fees that come with these cards. Aside from your annual percentage rate (APR) – aka, your rate of interest – you may also face the following fees:
Monthly or annual fee
Late or missed payment charges
Charges for cash withdrawals
Charges for going over your limit
Foreign transaction fees
The drawbacks of UK business credit cards
As with any funding solution, there are pros and cons to consider. There are potential risk factors you need to be aware of before choosing to take out a company credit card. We’ve outlined some of these below.
Interest rates are high
While interest rates are usually 0% or very low if you pay the funds back within the agreed revolving timeframe, if you miss a payment, interest rates can skyrocket. As that interest compounds, costs can become unmanageable until you end up in a debt cycle. If there is any possibility of missing payments, business finance is likely not a suitable option and business credit cards, in particular, are very unsuitable.
Even if you have every intention of making your monthly payments, it’s worth taking a few days to consider how you will repay your credit card if you’re taken by surprise with an emergency cost that depletes your cash reserves or if a particular client refuses to pay. Taking out a company credit card can be a good catalyst and opportunity for setting up an emergency fund – a reserve of money within your company that you can use to make payments even if an emergency occurs.
Company and personal credit scores
Missing payments on your credit card would also have a negative impact on your company credit score, affecting your ability to take out funding in the future, which can affect your ability to grow.
Not just that, but depending on your agreement with the lender, missing payments on your company credit card could even affect your personal credit score. This is particularly true if you have been asked to provide a personal guarantee as a company director.
Even without missing payments, the lender will likely run a credit check when you apply, which adds a hard search to either your personal or company credit record, sometimes both. Having your personal credit score impacted negatively can affect your ability to take out personal loans, lease a car, and even buy a house in the future.
Recurring fees
Some credit cards function like subscriptions, where you pay a monthly fee to be able to use the card. This fee can eat into your profits and stack up over the years. The recurring fee can range anywhere from a few pounds up to hundreds of pounds, depending on the card.
If you are considering taking out a credit card with a high recurring charge, carefully consider the benefits the card offers. Some cards offer access to airport lounges, better rewards systems, and even access to business events. Try to calculate the benefits of the rewards and weigh that against the cost.
For instance, access to a business event could be a good opportunity to network and close new deals, which could make the fee worth it. And access to an airport lounge may be a nice benefit that will ensure your employees arrive home after long business journeys happy to work. But the improved rewards system could amount to a minimal benefit if your company doesn’t usually make large purchases or if the rewards are not aligned with your business needs.
What happens if I go over my credit limit?
The purchase may be declined, or approved, depending on the lender and the agreement you have with them. It is not recommended to go over your credit limit, even if the lender does allow the purchase to go through. You would likely be charged a fee or increased interest and you may be required to repay the surplus immediately.
Going over your credit limit can also affect both your personal and business credit score. Credit utilisation refers to the amount of debt you use out of the funds accessible to you. Let’s say, for instance, you have a £10,000 business line of credit available.
If you use £1,000 of this, you will have a credit utilisation rate of 10%, which is a good rate. If you go over your limit, you’ll not only be surpassing the agreed funds according to the lender, you’ll also be at a 100% utilisation rate, which is well beyond the recommended rate of 30% and under.
What should I look out for when choosing a credit card?
There are many credit cards on the market, and almost as many lenders to choose from. So, how do you know what to look for? Here are some of the things you should keep an eye out for:
Compare interest rates. Look at what the interest rates are both for the interest free period (as some lenders do charge interest for this period) and if you miss a payment or do not pay the total back in full in a given month
Check if there is an annual fee and if so, for how much
Compare and contrast the rewards systems
Double check that interest rates won’t suddenly go up after the initial introductory period
Take a look at any infographics or videos of their platform that may be available online so you can get an idea of how easy making payments will be
Consider your own needs. What will your business be using the credit card for? If it’s to manage user access, look for a lender that focuses on that. If it’s for travel, look for a travel focused credit card company, as they may be able to offer you access to airport lounges and miles
A broker could be able to help you select the most suitable credit card for you and your business. This is because (if they’re an established broker!) they may have preexisting relationships with the top lenders in the UK and a wider pool to choose from and compare.
Look at Funding Options by Tide – we’re partnered with over 120 lenders offering between £1,000 and £20M. This means that when an eligible borrower comes to us, we’re able to compare a much wider range of options over what that borrower may be able to find from an online search. If you’d like to use a broker to help you find a business credit card, get a quote here.
How can I get the most favourable deal?
Improving your company or personal credit scores could help you get a more favourable deal. This is because lenders use credit scores to determine how likely you are to repay the loan, so if your score is low, they will perceive you as a riskier borrower and charge more.
To improve your credit score, make sure you stay on top of payments, as missing payments can drop your score lower. Try to pay off any historic debt and keep your credit utilisation low, which just means don’t spend more than 30% of your total credit limit.
You could also try negotiating with lenders, or using a broker to compare and contrast possible deals.
What will my credit limit be?
Your limit will depend a lot on your unique set of circumstances. To determine your credit limit, lenders may look at:
Your company or personal credit score
Your history with managing debt
Your business’ financial health
Any current debt
Whether you are using any assets as security for the card, however, credit cards are usually a form of unsecured lending
You may have different limits for the business and for individual employees. If you’d still like to know what you could get as a credit limit, get a quote here.
How do I apply for a business credit card?
First, find the agreement and lender you most like. You can do this by searching online and getting quotes, or by entrusting a broker with the job.
Once you’ve narrowed it down to a few lenders, enquire with them or the broker about your chances of getting approved. Lenders can sometimes run a soft credit check, which has less of an impact on your credit score and may still be able to indicate how likely you are to pass the approval process.
Then, gather your documents and apply directly with the lender. They should get back to you with a decision on your application quite quickly.
What types of businesses can apply for business credit cards?
Businesses of all shapes and sizes can apply for credit cards, but, businesses with longer trading histories may have more luck when it comes to finding more favourable terms. We help eligible sole traders, established businesses, new limited companies, start ups and even businesses with bad credit find funding.
Why should I use Funding Options by Tide to find a business credit card?
Our relationship with over 120 lenders offering between £1,000 and £20M, our long-lasting reputation in the industry, and our collection of successful case studies makes us an often turned to resource for business owners across the UK.
To date, we’ve helped over 18,600 customers obtain more than £862M in funding. That experience has given us excellent insights into what our customers really want, what lenders are looking for, and where the most favourable deals are. A chat with our team is commitment free, so even if you just want some advice or would like to hear your options, feel free to get a quote and we’ll be in touch.
What are the alternatives to a UK business credit card?
If a business card isn't the right solution for your company, there are plenty of business credit card alternatives to choose from, including:
Merchant cash advances
A merchant cash advance enables you to borrow money and pay it back through a percentage of your customers' card transactions
Revolving credit facilities
A revolving credit facility lets you withdraw money, make purchases for your business, repay the borrowed amount and then withdraw it again when you need it. If you’re looking for something similar to a credit card but without being tied to a card, a revolving credit facility may be for you
Invoice finance
Invoice finance allows you to use your unpaid invoices as security for funding
Asset finance
Asset finance allows you to spread the cost of the purchase, or lease instead of buying
Please note that the information above is not intended to be financial advice. You should seek independent financial advice before making any decisions about your financial future.
It’s important to remember that all loans and credit agreements come with risks. These risks include non-payment and late-payment of the agreed repayment plan, which could affect your business credit score and impact your ability to find future funding. Always read the terms and conditions of every loan or credit agreement before you proceed. Contact us for support if you ever face difficulties making your repayments.
Funding Options, now part of Tide, helps UK firms access business finance, working directly with businesses and their trusted advisors. Funding Options are a credit broker and do not provide loans directly. All finance and quotes are subject to status and income. Applicants must be aged 18 and over and terms and conditions apply. Guarantees and Indemnities may be required. Funding Options can introduce applicants to a number of providers based on the applicants' circumstances and creditworthiness. Funding Options will receive a commission or finder’s fee for effecting such finance introductions.
